What is a Project Management Office? A Complete Guide to PMOs

Project management is a profession with a lot of acronyms. If you are a title manager or not, PMO is one word you would most definitely hear about. Project management offices (PMOs) have grown tremendously in popularity over the last decade. According to The State of PMO 2016, since 2000, the number of businesses with a PMO has almost doubled.

You might be asking, what is PMO? PMO stands for Project Management Office, and to find out more, keep on reading.

PMO Defined

A project management office (PMO) is a division or department of a corporation, governmental agency, or company that establishes and maintains standards for project management within the organization. The PMO aims at harmonizing and implementing an economy of repetition in project execution.

In short, The PMO maintains documentation, guidelines, and data sets for project implementation, which ensures the completion of projects on time and also within the budget.

What is a PMO responsible for?

A Project Management Office is a unique department in an organization that maintains its project management standards. The PMO role in companies varies depending on the organization and projects to be implemented or carried out.

The following are the most common areas of activity or role of PMO:

PMOs act as project support

The PMO’s primary objective is to provide the project managers of a company with the required assistance in the form of advice. PMO also trains new project managers in several ways the business should run the projects.

PMOs build Project Management Processes

PMO’s other function is to ensure that reliable and structured business procedures are created and implemented. PMO aims to develop a shared set of values, policies, and frameworks as part of the project management process to coordinate multiple operational tasks. (Standardization refers to a manager’s ease of movement between functions and the accelerated learning curve for new project managers.)

PMOs create Project Management Templates

The use of standard components or concepts for different tasks is assured by developing project management models and saving time and resources for every organization.

PMOs help gather data

The PMO has to compile the appropriate project data and generate reports to management for approval. The PMO will monitor the projects’ overall status based on project managers’ information pertaining to one or more projects.

PMOs are in charge of Portfolio Management

It’s the PMO’s job to provide the appropriate information and data to project portfolio management (PPM). They may also monitor project budgets.

Who needs the project management office?

Not every company has a PMO, nor does every company need one. However, PMOs are beneficial as the number of projects within an organization grows, and with increased resources and rival agencies, the risk of failure is increased. A PMO is a driver who knows how each proposed project fits into a larger business strategy so that resources are adequately allocated and project failure can be mitigated.

You should establish a PMO if:

●        Projects are not meeting deadlines and are often running over budget.

●        Projects are not aligning with business objectives or schedules.

●        There is no visibility in your projects.

●        You are missing a standardized system of initiating and executing projects.

●        You fail to follow through with your projects.

The Increasing need for PMO’s

More and more companies are acknowledging the need for a PMO. PMO has been getting more and more popular lately. In 2000, only 47% of businesses had a PMO. In 2016, 85% said they had a PMO. This percentage rises to 95% for firms with sales above $1B. 30% of businesses without a PMO have meanwhile claimed that they would hire one within a year.

This considerable demand opens up a whole new career for many people and is an excellent site to pursue a career. PMO will be getting more opportunities in the coming years.

What Does a PMO Team Look Like?

PMO workers are highly trained professionals who have material industry experience. Furthermore, 45% hold a PMP qualification (Project Management Professional). 

The PMOs work according to the organization’s needs and priorities; because of that, every PMO is different in nature. Even though PMO teams operate differently, they consist of almost the same type of people performing similar roles.

Following are some designations almost every PMO has:

The PMO Director

Roughly 85% of PMOs have a PMO Director to supervise the company’s tasks, including maintaining project management methodologies, protocols, and instruments, designing the organization’s commitment to the whole project life cycle. And overseeing the delivery and deployment of capital in all projects.

Project and Program Managers

Project and program managers are increasingly being recruited in the PMO space. Active project manager positions within PMOs rose by a proportion of 42% in 2012 to 52% in 2016. Moreover, 29% of businesses submit 100% of their project managers to the PMO.

PMO Trainers and Coaches

Training is an integral aspect of the PMO. More than half of PMOs have a preparatory curriculum for project management. PMOs provide their hires with, on average, five days of preparation. In the following areas, high-performance PMOs provide project management training:

●        Software Tool Training for Project Management

●        Leadership Training

●        Basics of Project Management

●        Business Alignment Training

●        Development of Advanced PM Skills

●        PM Certificate

●        Agile Project Management

Supporting Roles

There are often supporting roles in a PMO to generate accurate data and aid project and program managers efficiently. These supporting roles vary from company to company, but the most common of these are:

●        Project Planner

●        Project Scheduler

●        Project Controller

●        Administrative Staff

There are also opportunities for budget planners, methodologist specialists, etc.

What are the challenges faced by PMO’s?

Specific challenges are faced by almost everyone in any profession. While the advantages of a PMO are obvious, PMO processes are also considered overhead. Evidence of added value can be challenging for the PMO to demonstrate, and obstruction often emerges to implement the management procedures they attempt to promote.

PMOs need time and the right metrics to accurately demonstrate their results and value. And often even office politics can affect the strategy of an entire PMO. 

Some of the more common challenges faced by PMO include:

●        Hiring project managers with inadequate project management skills

●        Assuring the consistent application of defined processes

●        Demonstrating the value-add proposition of the PMO to executives

●        Organizational resistance to change

●        PMO processes seen as overhead

PMOs should concentrate on calculating and reporting the highest PMO advantages mentioned in the above section to address those obstacles. Demonstrations of quantifiable efficiency, cost savings, customer satisfaction, and other KPIs demonstrate value and improve advocacy of a PMO.

What is the future of PMO?

PMOs are becoming more and more widespread, but PMOs’ potential existence in the future remains unclear. Emerging technology, such as smart devices, AI, and the IoT (Internet of Things) could replace many PMO’s daily functions. Many businesses already appreciate applications that report their progress analytics efficiently and quickly.

But if you are interested in this field, there is nothing to be worried about. There are plenty of other ways a PMO can demonstrate value to companies:

●        Identify and harmonize better with the ideals of their organizations. PMOs must adapt their way of operating to accommodate if their companies are trying to be more agile.

●        Emphasise importance of initiatives and services in question and of the PMO itself, use measurements and dashboards.

●        Connect creativity and stability requirements

●        Not only have strategies, but also have frameworks for implementing them

●        Understand how AI and IoT can impact the PMO space, and what the gaps they can’t close, so that you can target the PMO function appropriately.

Conclusion

PMO has been increasing in popularity. Through PMO strategies, companies are realizing growth, efficiency of process and successful standardization. Experienced and effective people are at the core of effective PMOs, and as emerging innovations arise and more innovation is pursued by businesses, PMOs must grow to adapt and change.

Are you looking to start you PMO dream team? We’ve built a free network that connects you directly to PMO talent from various industries. Upload your job now and we’ll connect you to the talent!

Bill Allars

Bill Allars

Bill is a Business Development Manager with 20+ of experience in Project and Portfolio Management, Project Administration, Risk Management and Process Redevelopment.

You may also like

Preparing Project Managers for AI
Project Management
Darian Smith

Preparing Project Managers for AI

How to prepare your project managers for AI Artificial Intelligence (AI) will fundamentally change the way we work in all

Get a Free Demo of pmo365

New Upcoming Online Events

Watch how microsoft pmo365 works in your industry

Learn how to manage your portfolio of projects in a centralised solution with Microsoft pmo365.

Limited time offer

Free 30-min
PPM audit

Review your existing projects portfolio data collection, tools, methods, current reports, dashboards, methodologies, frameworks and PPM best practices.